November 10, 2016

Effect of Tata-Mistry spat on investors in Tata Group companies

FPIs lose over 5% on their holdings in 9 major Tata Group companies

As of this Tuesday’s (November 8) closing prices, foreign portfolio investors (FPIs) lost 83.15 bln rupees due to shares held by them in nine key Tata Group companies and the ongoing battle between Tata Sons and Cyrus Mistry.

Since October 24, when Mistry was ousted from the chairmanship of Tata Sons, FPIs have seen their investments in the nine companies lose 5.5% to 1428 bln rupees from 1511 bln rupees.

The highest loss has been in the shares held by them in Tata
Consultancy Services Ltd.

On the basis of Tuesday’s closing price, the notional loss of FPIs
from their holdings in TCS has been to the tune of 48.46 bln rupees,
followed by the  notional loss in their holdings in Tata Motors to the
extent of 14.78 bln rupees.

This is seen from an analysis of shareholding data of FPIs in nine key
Tata Group companies. The analysis compared the collective value of
FPI holdings in the 10 companies as of October 24 with the value as of
Tuesday, based on their holdings as of Sep 30.

The nine Tata Group companies comprised of Tata Chemicals Ltd, Tata Communications Ltd, Tata Consultancy Services Ltd, Tata Global Beverages Ltd, Tata Motors Ltd, Tata Power Co Ltd, Tata Steel Ltd,Titan Company Ltd and Voltas Ltd.

Shares of these Tata Group companies have fallen from 2% to 17% sincebOctober 24, with Tata Global Beverages having fallen the highest at 17.3% to 127.5 rupees from 154.1 rupees and Titan Company having declined the lowest at 1.7% to 371.2 rupees from 377.6 rupees.

TCS’ share price has fallen by 6%. FPIs held a collective stake of 17%
as of Sep 30 and the value of this stake has fallen to 765.71 bln
rupees as of Tuesday’s closing price compared with 814.17 bln rupees
as of Oct 24 closing level.

In Tata Motors, where FPIs collectively held 26.1%, their holding
value has come down to 407.23 bln rupees from 422.01 bln rupees.
Shares of Tata Motors are down 3.5% since the day of Mistry’s ouster
from Tata Sons.

After TCS and Tata Motors, the highest value loss for FPIs are in TatabPower, Tata Chemicals and Voltas where they have seen their
shareholding value getting eroded by 6.54 bln rupees, 3.28 bln rupees
and 2.71 bln rupees.

In the remaining four group companies of Tata Global Beverages, Tata Steel, Tata Communications and Titan Company, FPIs have lost 2.51 bln rupees, 2.17 bln rupees, 1.44 bln rupees and 1.26 bln rupees

Non-FPI institutional investors have also lost heavily in the
Tata-Mistry spat. Their holding value in the nine Tata group companies
has fallen by 6.4% or 47.36 bln rupees to 742 bln rupees from October 24 to Tuesday.

These institutional investors have lost 14.69 bln rupees in TCS, 8.19
bln rupees in Tata Motors and 6.21 bln rupees in Tata Power.

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